A friend of mine recently started house-hunting in Stoney Creek with a budget around $700,000, and her first question wasn’t “how’s the market” — it was “how much cash do I actually need before any of this is real?” It’s the right question, and the honest answer is: it depends on the price, the type of mortgage, and a few rules that have shifted in the last couple of years. Here’s how the down payment math actually works in Ontario heading into the back half of 2026, with real numbers from this corridor.
Minimum Down Payment Rules in Canada
Canada’s minimum down payment isn’t a single flat percentage — it’s tiered by price:
- 5% on the portion of the purchase price up to $500,000
- 10% on the portion between $500,000 and $1.5 million
- 20% on the full price for anything at or above $1.5 million (CMHC-style insurance simply isn’t available above that point)
That means a $700,000 home doesn’t require 5% of $700,000. It requires 5% of the first $500,000 ($25,000) plus 10% of the remaining $200,000 ($20,000), for a total minimum of $45,000 — not the $35,000 a flat-5%-everywhere assumption would suggest. It’s a detail that catches a lot of buyers off guard the first time they run the numbers.
What Counts as “Insured” vs. “Conventional” Mortgages
If your down payment is under 20%, your mortgage is considered “high-ratio” and must be insured — typically through CMHC, though Sagen and Canada Guaranty also offer mortgage default insurance. The insurance protects your lender if you default, not you, but it’s what makes a smaller down payment possible at all. Put down 20% or more and you’re in “conventional” mortgage territory, where insurance generally isn’t required (though some lenders apply their own stricter qualifying criteria on uninsured deals).
There’s also a price ceiling on insured mortgages: as of a December 2024 rule change, the cap rose from $1 million to $1.5 million — and that higher cap applies to everyone, not just first-time buyers. What is restricted to first-time buyers and new-construction purchases is access to 30-year amortizations on an insured mortgage; repeat buyers on a resale home are still limited to 25-year amortizations even with the same $1.5M price cap available to them Above those caps, you’re into conventional-mortgage territory regardless of your down payment size.
CMHC Insurance — What It Costs You
CMHC (and the other insurers) charge a premium calculated as a percentage of your mortgage amount, and that percentage drops as your down payment grows:
| Down payment | Approx. premium (% of mortgage) |
|---|---|
| 5% | ~4.00% |
| 10% | ~3.10% |
| 15% | ~2.80% |
On a $700,000 home with 5% down, you’d be financing roughly $665,000 — and a 4% premium on that is close to $26,600, which gets added to your mortgage rather than paid as cash upfront in most cases. Ontario also applies provincial sales tax to the premium itself, which does need to be paid upfront. It’s one more reason a larger down payment, where you can manage it, isn’t just about a smaller mortgage — it’s about avoiding this cost entirely.
Down Payment Assistance Programs
A few programs exist specifically to help with the saving side of this equation:
- First Home Savings Account (FHSA): Contribute up to $8,000 per year, to a $40,000 lifetime limit. Contributions are tax-deductible, and qualifying withdrawals — including any investment growth — come out completely tax-free when you use the money toward a first home.
- RRSP Home Buyers’ Plan (HBP): Withdraw up to $60,000 from your RRSP tax-free (up to $120,000 combined for a qualifying couple, since it’s two individual limits), as long as you repay it back into your RRSP over the following 15 years.
- Ontario Land Transfer Tax Rebate: Not a down payment program directly, but it frees up cash that would otherwise go to closing costs — eligible first-time buyers can claim a rebate of up to $4,000 against Ontario’s land transfer tax.
These can be combined. A couple using both the FHSA and the HBP could realistically bring well over $150,000 of their own savings to the table tax-advantaged, before a single dollar of gift or non-registered savings comes into play.
What a Down Payment Looks Like by Price Point
Here’s the tiered math applied to price points that map onto real listings in this corridor — for context, Hamilton’s average sale price was $755,202 in May 2026 and Burlington’s was $1,205,121.
| Price point | Minimum down payment | Insured? |
|---|---|---|
| $500,000 | $25,000 (5%) | Yes |
| $700,000 | $45,000 (5% + 10% blended) | Yes |
| $900,000 | $65,000 (5% + 10% blended) | Yes |
A $900,000 home — within range of an Ancaster or Burlington single-family purchase — still qualifies for an insured mortgage with as little as roughly 7.2% down overall, well under the 20% a lot of buyers assume is required everywhere.
Gifted Down Payments — Rules to Know
A gifted down payment from family is common and entirely legitimate, but it has to follow a few rules:
- The gift generally needs to come from an immediate family member (parent, grandparent, sibling), and it must be a genuine gift — not a loan you’re expected to repay.
- There’s no legal limit on the gift amount, and no gift tax in Canada on either side of the transaction.
- Lenders typically want the funds to “season” in your account for a period before closing — often 15 to 30 days, longer if the funds originate outside Canada (this varies by lender, so confirm the exact window with whoever is underwriting the mortgage).
- You’ll need a signed gift letter confirming the donor’s name, relationship, the exact amount, and that it’s a gift with no repayment expected.
If part of your down payment is coming from family, loop in your mortgage broker early — the paperwork is straightforward, but it needs to be in place before your lender will count the funds.
Ready to figure out your number?
Down payment math gets specific to your situation fast — your price range, whether the home is new construction or resale, and how much you’re bringing from savings versus a gift all change the answer. Get in touch and I’ll walk through what it actually looks like for the home you have in mind, or start with our overview of the home-buying process if you’re still early in your planning.